cornered rat, thanks for responding. In general, I would want to gently encourage your friend to spend some time at
http://www.cato.org/ , read some books on libertarian philosophy (although fiction, 'Atlas Shrugged' is an interesting start), and generally give the concept an honest chance. I honestly believe that so-called 'liberal' solutions to societal ills are attractive partly because they are so obvious (and yet, not often 'simple'). Unfortunately, the obvious solution is not usually the best solution. With a foundation belief in freedom, your friend can step back and brainstorm other potential solutions to the problems he / she finds vexing.
Re: negative company externalities, such as pollution: companies, like individuals, must be responsible for their behavior. If a company or an individual pollutes someone else'e property, then the courts should hold them accountable. If they pollute their own property, then they suffer the loss of its economic value.
This is certainly one of the tougher libertarian issues for me. IMHO, 'environmentalists' too often have a hidden agenda behind their environmentalism, and that usually revolves around socialistic controls, 'small is beautiful' philosophies, and such. [I say this after working in the anti-nuke movement in the early '80's, and after founding an award-winning environmental organization. I've seen this first hand.] By the same token, the courts are not always efficient in punishing companies appropriately. I believe that, in today's world, companies have many incentives to 'keep their noses clean', and those include public relations, law suits and investor pressure. Again, the libertarian solutions are not perfect, just better.
But, compare the current solutions. Perhaps their stand has changed, but it wasn't long ago that the Sierra Club, a former ally of mine, was quite happy with preventing people from developing their property if it happened to be habitat for an endangered creature. Certainly the policy was well-intentioned, but it was also unconsciousable to damage the value of the owner's land without just compensation (if you can't build on it, it is simply worth less). So-called 'liberal' solutions almost always display a disregard for econonomic freedom and property rights. And, again, how can one be considered free if the state has such easy access to the fruits of our labors?
I won't go into such detail for the rest of your examples, but I'll note that:
1. "'40 cents a day' won't make a difference to us" - sounds fine, but it doesn't stay at 40 cents a day. It's just 40 cents a day for that program. And, if that didn't make much difference, how about 50 cents, then 80 cents, then $8.00. And, it misses the point that a private group probably could have done it for 10 cents a day in the first place.
2. "'No one' is going to give money to charity"? I don't think history supports that perspective. And, if the goal is to prevent all failure and bad things, (1) we'll never get there, and (2) failure serves to encourage people to succeed. If no one failed, what incentive would there be to work hard and excel? Some would. Too many wouldn't.
3. No medical research? Pharmaceutical company stocks often seem to be good investments. They wouldn't produce new medicine without a government stick over their heads?
4. Regarding national defense and roads, I believe in a strong national defense, and consider it one of the few proper roles for federal government. Roads are a tougher issue, and I'll point out that we have had some very successful private road systems in our history.
Many of these statements give the appearance of a misunderstanding about a free market, how it works and why it works. Isn't perfect, but it is much better than the example comments you provide, IMHO.
Libertarian philosophy, or at least other than so-called 'liberal' thought, is not a monolith. There is a continuum of libertarian thought, just as there is for Republicans and Democrats. However, it is still founded on the core beliefs of economic and personal freedom, coupled with personal responsibility.
I empathize with your circumstances. Probably 7 years ago a friend made me confront my true political philosophy. He wasn't terribly gentle about it, but I appreciated his honesty under the circumstances. It made me stand back and take a real hard look at what I truly believed and held dear. Sometimes that can be accomplished with gentle debate that encourages a friend to reexamine their premises.
Good luck, and regards from AZ.